Business Models

[pdkn]

Humm, Business models are something I normally leave to
people who actually understand the value of money ;) However here
are my thoughts.



Issues:

Multiuser development is seen as
expensive

cost are normally handed down from
agency to client

Clients are demanding and like to
have options. i.e some have fixed costs and like paying up
front.

Licensing is great for service
provider, board members love it, but not always best for customer.
As over time you could pay a LOT more than just being able to own
something out right.

I would have though a lot of agencies
already have FMS infrastructure?

I'd love to see software licensing look more like car
insurance where it gets cheaper the longer you have it. The premise
being setting out goals about how much adobe want to make, saying;
'we've got our pound of flesh out of this consumers application'
lets make it cheaper and cheaper over time to run till their paying
near cost.'

If you can have a strapline like: 'using this service you'd
never pay more that you would if you hosted a FMS yourself' (who
knows, hopefully with economy of scales, even cheaper?) Then you've
got a very attractive proposition. and able to address the issue
about long term users being a 'victim of there own success'. I'm
sure with a bit of Advocacy you could figure out some equations of
concurrent users, data transfer rates, age of app life..? else
you'll just have to pay me for my Numerology skills ;) anyway,
that's my 10 cents - or is that £1?

[pdkn]

Forum donesn't like Bullets ;( here's another go: --------



Issues:



Multiuser development is seen as expensive

cost are normally handed down from agency to client

Clients are demanding and like to have options. i.e some have
fixed costs and like paying up front.

Licensing is great for service provider,board members love
it, but not always best for customer. As over time you could pay a
LOT more than just being able to own something out right.

would have though a lot of agencies already have FMS
infrastructure.



I'd love to see software licensing look more like car
insurance where it gets cheaper the longer you have it. The premise
being setting out goals about how much adobe want to make, saying;
'we've got our pound of flesh out of this consumers application'
lets make it cheaper and cheaper over time to run till their paying
near cost.'

If you can have a strapline like: 'using this service you'd
never pay more that you would if you hosted a FMS yourself' (who
knows, hopefully with economy of scales, even cheaper?) Then you've
got a very attractive proposition. and able to address the issue
about long term users being a 'victim of there own success'. I'm
sure with a bit of Advocacy you could figure out some equations of
concurrent users, data transfer rates, age of app life..? else
you'll just have to pay me for my Numerology skills ;) anyway,
that's my 10 cents - or is that £1?

[Former Community Member]

Thank you for your thoughts and suggestions! You make a lot
of interesting points, including your comments on competitive
pricing relative to self-hosting FMS, passing economies of scale to
agencies, and trade-off's of license fees vs. subscriptions. Rest
assured that we are considering all of them as we work towards
creating a pricing model.



As you are already aware, most pricing models mirror cost
structures incurred by companies. Your example of car insurance
pricing maps very well to the price-cost alignment approach. In
most cases, the longer you keep an insurance policy the better
pricing you get. Part of reason behind better pricing is that there
is no (or very minimal) incremental cost incurred by the insurance
company to support you for each incremental year. The big
constraint in all of this is that you need to maintain your driving
record and any insurance claim will typically increase pricing. In
fact with every year the insurance company lowers your price
because they have a more accurate "risk profile" of you which maps
to their cost structure in supporting you.



But why am I mentioning all of this? The reason is that,
unlike the insurance product, a platform-as-a-service offering has
considerable on-going costs associated with managing, maintaining,
and upgrading the infrastructure. Usage (rather than time) is a
better metric for availing reduced pricing and as you mention we
will be sharing with you cost synergies due to economies of scale.



We hope that in most cases "Cocomo-powered" applications will
be so compelling that usage will increase with time, which will in
turn mean attractive pricing for agencies. Regardless, there are
other alternatives available to agencies so any pricing we propose
needs to be competitive and attractive for Adobe and our customers
to be successful long-term.

[pdkn]

hi VarunParmar,



Usage is indeed a far better metric to use. Thanks for you
detailed response, you're clearly 'on the case' ;) I look forward
to seeing the details ;) best, paddy ;)